Thinking of hiring staff to cover the Christmas rush? Make sure to pay your new employees their superannuation guarantee, no matter how few hours they work, the Australian Taxation Office (ATO) says.
As of July 1 this year, employers are required to pay their workers a superannuation guarantee at a rate of 10.5%, even if they only pick up a handful of hours each week.
Previously, employers were only on the hook for superannuation if an adult employee earned more than $450 per month.
As employers scramble to find staff for the traditionally busy months ahead, the ATO this week reminded business owners to check their employee eligibility.
Business owners should also take the time to “check your payroll and accounting systems have been updated so you’re calculating your employees’ [superannuation guarantee] payments correctly,” the tax office said.
Considering that many young workers take on their first job during the Christmas season, the ATO has also reminded businesses that employees under 18 are only eligible for superannuation if they work more than 30 hours each week.
The removal of the $450-a-month threshold was one of several measures included in the Coalition government’s 2021-2022 federal budget, designed to ease superannuation inequality between workers.
In particular, the government raised serious concerns that women were being left behind in retirement compared to their male counterparts.
The prevalence of women working insecure roles with volatile schedules meant they were particularly likely to miss out on superannuation accrual because of the $450-a-month threshold.
At the time, former superannuation minister Jane Hume called the threshold a “discriminatory, inequitable relic”.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
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